Average margin per user
Encyclopedia
Average margin per user (AMPU) is one of several criteria for measuring the success of telephone companies. It is an alternative to ARPU, which focuses on revenue per unit. The central premise is that by attention to the margin
produced per sold unit, not the amount of cash (revenue
) earned from each customer, one can afford low volumes and still have a healthy company. High volumes can also bring a significant edge, but only until competition forces prices down. Telecom analysts are traditionally highly focused on ARPU because the typical telco has had huge infrastructure costs that needs to be serviced by a considerable ARPU.
Another use of AMPU in some telephone companies (in particular Telenor
) is Average Minutes Per User, meaning the amount of time (measured in minutes) the average subscriber talks (or listens) in their phones. This term is also called Minutes-Of-Use or MOU.
Gross margin
Gross margin is the difference between revenue and cost before accounting for certain other costs...
produced per sold unit, not the amount of cash (revenue
Revenue
In business, revenue is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. In many countries, such as the United Kingdom, revenue is referred to as turnover....
) earned from each customer, one can afford low volumes and still have a healthy company. High volumes can also bring a significant edge, but only until competition forces prices down. Telecom analysts are traditionally highly focused on ARPU because the typical telco has had huge infrastructure costs that needs to be serviced by a considerable ARPU.
Another use of AMPU in some telephone companies (in particular Telenor
Telenor
Telenor Group is the incumbent telecommunications company in Norway, with headquarters located at Fornebu, close to Oslo. Today, Telenor Group is mostly an international wireless carrier with operations in Scandinavia, Eastern Europe and Asia, working predominantly under the Telenor brand...
) is Average Minutes Per User, meaning the amount of time (measured in minutes) the average subscriber talks (or listens) in their phones. This term is also called Minutes-Of-Use or MOU.